Detailed system and semiconductor demand analysis for in-vehicle infotainment, telematics and vehicle-device connectivity features.

June 11, 2013 15:21 rlanctot

(This commentary was written at the request of and published simultaneously by AutomotiveWorld -

Brazil is known for its activist government, particularly when it comes to the country's economy.  Brazil's government has an impressive track record reversing its economic misfortune and runaway inflation.  But Brazilian consumers now must take the bad with the good, meaning taxes are high, as are the prices of cars, even in the absence of competitive safety systems and quality construction.

As the world's fourth largest car market, seventh largest producer of cars and one of the fastest growing car markets, Brazil faces opportunities and challenges.  Brazil sees an opportunity in leveraging its burgeoning automotive influence to become an exporter of cars.  But before it can export it will have to bring the quality and safety of its cars up to par.

According to a report in just-auto, Luiz Moan, the new president of Anfavea, Brazil’s automotive lobbying group, is seeking to restore Brazil’s auto exports to 2005 levels or higher.  Exports of cars have plunged by nearly 50% since 2005 as Brazil’s economy has strengthened, along with its currency.  Just-auto reports that Anfavea’s goal is for 5M in domestic sales, 5M in domestic production, 1M exported and 1M imported – with the import target slightly exceeding 2005 import levels.

Brazil’s government clearly regards its swelling automotive market as a strategic asset and, true to form, has sought to both protect and stimulate it – reducing industrial taxes in the past year and imposing a harsh import duty late in 2011.  The tax initiative had some positive impact in maintaining growth and the import duty brought immediate commitments from importers (ie. BMW, Hyundai and multiple Chinese importers) to open new factories or expand existing facilities.

Brazil is still struggling to come to terms with high rates of vehicle theft, stifling traffic conditions and increasing highway fatalities.  Brazil has surpassed the U.S. in the number of annual highway fatalities as well as the rate per miles driven, cars owned and per 100,000 citizens.

Brazil is hoping to combat the plague of vehicle theft by instituting its Contran 245 mandate for fitment of a vehicle tracking and immobilization device in all cars, trucks and motorcyles by the end of calendar 2014.  Management of traffic has been left to municipalities which are in the very earliest stages of developing sophisticated traffic management schemes. 

Sao Paulo has made the most progress in implementing RF technology for tolling and instituting a license plate number-based scheme for limiting vehicle use.  More clearly needs to be done and Brazil’s government is not likely to sit idly by.

Perhaps the saddest footnote to the tale of Brazil’s automotive market emergence, though,  is the rising death toll on the nation’s highways – now well surpassing the 100 fatalities/day seen in the U.S.  A report in the Huffington Post (, points to a lack of safety standards (airbag and anti-lock brake requirements coming next year!), a lack of testing facilities, a lack of consumer awareness and poorly regarded local build quality.

If Brazil is to fulfill the opportunity of becoming one of the leading auto markets in the world – not only consuming cars but building and selling them – the quality and safety of the cars made in Brazil must improve.  And this change must come even before exchange rate and other challenges are overcome.  In the end, the first to benefit from those improvements will be Brazilians. 

It will also help make Brazilian vehicles more welcome in local export markets which are no less protected than Brazil’s own.  If Brazil can establish safety leadership for the region, Brazilian cars might become attractive imports for Venezuela and Mexico, rather than being seen as inexpensive “deathtraps,” as they are perceived today.

June 10, 2013 14:26 rlanctot

Google and its self-driving cars (SDCs) are scaring the wits out of the automotive industry. There’s nothing major car makers would like to see more than a swift departure of Google from the automotive domain. The next best outcome for auto makers, therefore, is to discourage or delay Google-led initiatives like SDC.

The National Highway Traffic Safety Administration has come to the rescue with guidelines for states in the U.S. that may be considering allowing self-driving cars to operate. (Google has stated that it does not support the NHTSA guidelines.)  These guidelines boil down to:

·         Simple transition from automated to driver control

·         Be able to detect, record and inform driver if the system malfunctions

·         Technology does not disable federally required safety features

·         Records information in the event of a crash

More details are available:

There are currently two paths toward self-driving cars.  One path, the one with which more consumers will be familiar, is the path defined by Google’s autonomous car – and already familiar from multiple DARPA-led challenges where various organizations and university programs create autonomous vehicles competing to cross the desert or operate in city traffic.

The other self-drive car path is based on 802.11p DSRC (Dedicated Short Range Communication) technology – now being tested at the University of Michigan Safety Pilot study -  DSRC is the technology behind vehicle-to-vehicle and vehicle-to-infrastructure technology intended to enhance vehicle safety by creating a network of vehicle communication for the purpose of eliminating all driver-related collisions or approximately 80%-90% of accidents.

As a result, what is emerging is a private initiative currently “led” by Google – as the first company to put a self-driving car on the road – competing with a vision of autonomous driving ultimately enabled by a government mandated DSRC module.  NHTSA’s recommendation that states only allow SDCs for testing purposes only for the next four years buys time for the auto industry to “catch up” with Google’s massive headstart in the marketplace and the minds of consumers.  (Audi notably has its own autonomous car operating in the U.S.)

While the Google car is notorious for its use of a rooftop lidar device reportedly having a cost of $70,000, the expectation is that the size and cost of this hardware will both shrink rapidly.  Meanwhile, NHTSA is pushing toward the eventual mandate of a DSRC module in every car intended ultimately enable self-driving cars along with a range of other applications focused on safety and traffic management.

The auto industry’s response to Google’s private commercial initiative was evident in survey results released last week at the Telematics Update 2013 event.  The Alliance of Automobile Manufacturers (AAM) released survey results showing that 33% of consumers think the idea of self-driving cars is a good one, but the AAM chose to focus on the 42% of respondents who said it was a bad idea.  A further 24% were unsure what to think.

To this analyst, the idea that any consumers at all viewed self-driving cars as an attractive proposition is big news.  It’s not as if Google launched its car in response to overwhelming demand.  The move was an intuitive one driven by personal experience – more and more people find driving intrusive and unpleasant and will welcome the SDC concept.

The AAM findings go on to report that 75% of respondents said they were very concerned that companies would collect personal data and 70% said they were very/somewhat concerned this information would be shared with the government.  AAM also said 81% of respondents reported they were either very or somewhat concerned that hackers could gain control of self-driving cars.

The irony here is that a Google-type SDC is far less likely to be sharing data with the government or to be exposed to hackers than a car with a government-mandated DSRC module.  Who is a consumer more likely to trust these days:  Google, with whom hundreds of millions of consumers are already sharing their data; or the government (ie. NHTSA), which has recently been caught in a range of over-reaching personal information intrusions in recent weeks.

My money is on private, commercial initiatives, such as those driven by Google, Audi, Continental and other car makers and their suppliers.  The impact of the government mandate approach has been to narrow the field of potential participants in the DSRC space, freezing out innovation and investment.

Further working against the long-term success of DSRC has been the inability of the leaders in the space to find and adopt practical applications for the technology.  In 10 years there has been little or no commercial deployment of the technology.  It appears that even the Federal Communication Commission in the U.S. – the agency responsible for allocating the required spectrum – has lost patience with the NHTSA program – choosing not to “protect” the spectrum from unlicensed use.

The first green shoots of DSRC deployment are beginning to appear, with Kapsch announcing a self-parking implementation for commercial vehicles.  Let’s hope this is just the beginning.  Next steps ought to include deployment of DSRC on emergency vehicles (for intersection collision avoidance – 9,000 people killed annually in the U.S. at intersections) and fleets.  But 10 years of testing with no deployment raises serious questions regarding the management of the DSRC program.

NHTSA and AAM ought to be fostering not discouraging development and deployment of SDC technology.  Telling states to shift into a testing-only mode is hardly the kind of bold innovation-fostering push the industry needs.  With 33% of consumers telling AAM they think SDC is a good idea, it is clear there is a market for the technology.

Simple directives are best.  All NHTSA really ought to say at this point is that a driver must be in the driver seat at all times and the driver is still responsible for the operation of the vehicle.  One sentence, rather than 14 pages of regulatory hoo-hah.


June 2, 2013 15:04 rlanctot

A battle is erupting over the $400B vehicle repair and maintenance market in North America and the clarion call to arms was sounded at the Automotive Aftermarket Industry Association’s (AAIA) Aftermarket eForum last month.  AAIA is sounding the alarm well ahead of the anticipated assault by OEMs, which AAIA perceives as leveraging telematics technology to apply a stranglehold to their aftersales business.


Though slightly premature, AAIA’s concern is real and the organization attributes its decision to raise the alarm to the emergence of embedded telematics and smartphone solutions in cars that are expected to cement the customer’s devotion to his or her dealer for service and repairs.  The irony here is that forces are afoot in the industry to deliver precisely the opposite value proposition – leverage vehicle diagnostic data (openly available via OBDII port connections) to enable an open market for vehicle repairs from which independent shops will benefit.


Before detailing emerging disruptive solutions it is useful to understand the current state of play in the automotive aftermarket, especially as regards embedded connectivity and smartphones:


OEMs – Car makers have only slowly begun to recognize the value of gathering and interpreting vehicle diagnostic data.  OnStar has famously led the way in this area, making use of its connected captive fleet to anticipate potentially expensive problems prior to vehicle launch.


OnStar has yet to completely embrace and use vehicle connectivity as an end-to-end diagnostic solution capable of being applied to supply chain processes during production and delivery of its cars.  Similarly, OnStar has left dealers out – failing to provide dealers with vehicle management tools such that GM dealers could use the telematics system to manage their customers as if they were fleet managers.


GM has taken the step of making a monthly vehicle health report available to the consumer and alerting dealers to diagnostic trouble codes from the vehicle.  But neither dealers not consumers have control of the information and, indeed, information access is limited either online or via smartphone apps.


Ford has yet to completely embrace the concept of embedded connectivity, but Ford has a smartphone-based application that enables the customer to obtain a fixed set of vehicle diagnostic information at the touch of a button in the car.  The button push produces an email with a diagnostic report on the car which is also transmitted to the customer’s preferred dealer and to Ford’s own engineers.


The Ford solution is attractive for allowing access to the information on demand, but it is reliant on email communication of the vehicle information and lacks real-time elements such as an explanation of the problem in the car or the provision for scheduling a dealer visit should one be necessary. 


Mercedes-Benz’s mbrace2 allows the customer to request a “ping” of the vehicle’s diagnostic data in real-time which can then be interpreted at that moment by a call center representative.  Mercedes does not provide for an on-board service scheduling capability, though the call center operator is presumably capable of contacting the dealer on the customer’s behalf. 


BMW’s TeleServices connected service will alert the dealer to scheduled maintenance, after which the dealer is obliged to contact the customer to schedule an appointment.  In the event of a diagnostic trouble code that triggers a message in the dashboard, the dealer is not notified and the customer must depress the in-car SOS button to summon assistance.  If the customer presses the SOS button, then BMW and the dealer will receive the diagnostic information. 


Hyundai is the most advanced car maker in the customer relationship space.  The company’s BlueLink embedded telematics solution enables real-time scheduling of dealer service appointments based on scheduled or unplanned repairs tied to in-vehicle alerts with the help of partner Xtime.  The cloud-based application enables a VIN-specific engagement with the customer along with integration with the dealer management system and access to a comprehensive database of diagnostic trouble codes and correlated service requirements including hours, parts and processes.


Hyundai is also the only OEM that is provisioning its on-board modem early enough to use it as a supply chain tool either during production and delivery or at least post-production.


In broad terms, the OEM threat to third party service providers, though real, is only just beginning to emerge.  Car makers are still coming to terms with core issues such as:


A - The opt-in participation of the customer in sharing vehicle data

B – The sharing of vehicle data with the customer on an ad hoc, on-demand or real-time


C – The sharing of vehicle data with the dealer on a real-time basis

D – The use of vehicle connectivity data as a comprehensive, supply chain proposition

E – The use of vehicle data for customer retention purposes


Most OEMs with smartphone application integration are offering remote access to vehicle functions such as remote start and pre-conditioning.  And most EVs come with a smartphone integration solution that allows the user to determine the battery’s charge status remotely.  But more complete smartphone-based diagnostic tools have not yet arrived on the market. 


Aftermarket – Given the alarm expressed by AAIA at the threat posed by OEM customer relationship initiatives, it is the aftermarket that is making the greatest strides in enabling powerful customer connections intended to help obtain and retain aftersales business.  A growing portfolio of OBDII devices from Verizon (Delphi and Hughes), Audiovox, CarMD, GoPoint, Mavizon, CarShield, and Automatic, along with a host of usage-based insurance offerings are creating new opportunities to engage with customers via smartphone apps and/or customer-facing portals.


An another emerging layer of companies with such names as Vehcon and AutoAdvantage are creating smartphone-based platforms for service engagement designed around opening up service opportunities to third parties.  And there are general purpose diagnostic devices or applications from startups Automatic and Dash Labs, forensic-oriented offerings from companies such as Lysanda, and collision-oriented devices from companies such as In-Car Cleverness.


In fact, the veritable flood of aftermarket products in the market or coming soon promises increased awareness among consumers of the lowly OBDII port.  Whether consumers will embrace the opportunity attach these devices to their cars remains to be seen.  And there is no question that the companies offering these products will have to provide for periodic removal of the device to allow multiple devices to be plugged in at different times.


In the U.S., and in other markets, the battle lines are being drawn over what are called “right to repair” laws.  The state of Massachusetts was the latest entity to pass such a law requiring car makers to share vehicle diagnostic information to enable third parties, or even do-it-yourselfers, to access the codes and software necessary to fix increasingly sophisticated automotive systems.


The next stage in this battle is a growing clamor among independent dealers and the aftermarket industry as a whole to have access to diagnostic trouble codes in real time.  A new vehicle service paradigm is beginning to emerge in this context where service exchanges might emerge where diagnostic trouble codes are gathered and made public, in real time, and independent servicers are able to bid on the repairs.


In fact, one might imagine such an exchange residing in his or her dashboard or manifesting on a smartphone app in real time.  Engine light trips on and almost instantly the driver is provided interpretive information and a quote for the repair from the dealer and a couple of local independent shops.


Of course, it is important to remember that it was not so long ago that an embedded navigation system in a BMW would not even allow the driver to locate nearby Mercedes-Benz dealers from the on-board POI database.  But the opening up of vehicle connectivity, while creating new customer retention opportunities, may also open the door to increased opportunities for third-party parts and repair organizations.


The AAIA has it right.  A battle for the hearts, minds and service appointments of drivers is emerging – especially as cars last longer and longer – more than 11 years on average, according to R.L. Polk’s latest data.  The aftermarket is winning the arms race.  But OEMs are slowly awakening to the risk to their customer relationships.

May 28, 2013 03:21 rlanctot

Rumors ran rampant last week, and the week before, that Facebook and then Google were in talks to acquire Waze, the Israel-based crowd-sourced navigation solution, for approximately $1B. The price may be about right but the acquisition target is wrong.

All arrows are pointing in the direction of R.L. Polk and Carfax as the next big automotive acquisition.  Industry sources suggest that R.L. Polk is the more likely acquisition target, primarily for its CarFax division. For several months it has been known that R.L. Polk is exploring strategic options, including the sale of Carfax or even an IPO.

Potential acquisition candidates cited in press reports include Automatic Data Processing (ADP), Reynolds and Reynolds, Dealertrack Technologies, KAR Auction Services, McGraw-Hill Cos, J.D. Power and Associates, and Cox Enterprises, which owns has likely taken itself out of the running after announcing a marketing relationship with Experian which owns Carfax vehicle history report (VHR) competitor AutoCheck.

The road to an acquisition was recently rendered a bit rocky by a lawsuit being threatened by a dealer franchise attorney – Leonard Bellavia – on behalf of automobile dealers challenging the alleged monopolistic tactics of Carfax including exclusive agreements with OEMs and others locking in premium charges for VHR for certifying used cars. The Carfax service is used widely by OEMs as well as by and One of the most galling elements, of course, is recent television ads that not only encourage consumers to “ask for the Carfax” vehicle history report, but that disparage dealers who don’t make the information available.

Lost in the news of the potential R.L. Polk sale and the threatened lawsuit is the actual treasure-trove of data that Carfax represents. Carfax has compiled what it describes as 11 billion vehicle records from 44,000 sources across North America including VIN-specific service histories and diagnostic data.

In February, Carfax launched its Carfax Service Network designed to help dealers better target service opportunities by leveraging the massive Carfax database. In case anyone failed to get the message, Carfax noted that the Automotive Aftermarket Status Report of the Automotive Aftermarket Suppliers Association identified an estimated $60B in “manufacturer-suggest maintenance (that) goes unperformed every year.” Carfax is offering to help dealers and independents better target those opportunities.

But even more essential than that, to a Google or Facebook, is the VIN-related data including owner information that can be leveraged for better targeting of advertising. As if Google and Facebook didn’t already know enough about the users of their services for the purposes of targeted messages, the acquisition of Carfax will enrich these organizations with mine-able data regarding the average person’s most expensive asset.

By comparison, Waze has a crowd-sourced map that neither Google nor Facebook need and a user population that is miniscule relative to the existing user base of either Google or Facebook. And Waze has failed to solve the location-based marketing/advertising challenge in a material way capable of having a transformative impact on either Google or Facebook.

This is not to say that Waze is unpopular. Waze is the go-to navigation solution for tens of millions of users around the world.

But Carfax is a play for immediate revenue, a recognized and powerful brand, a massive mine-able database, and a roster of contractual relationships with OEMs, dealers and independent shops that promises ongoing returns. But, most important for Google and Facebook, is the synergy of the Carfax database with Google’s and Facebook’s existing resources and advertising model. No other potential acquirer has as much to gain from a Carfax acquisition as either Google or Facebook.

April 22, 2013 13:58 rlanctot

Pioneering UBI provider Progressive has changed up its messaging around the Snapshot usage-based insurance offering with a new ad campaign in the U.S. built upon the concept of Rate Suckers. The campaign shifts the UBI angle from being a simple means to achieving a discount, to an aspirational model capable of creating an elite group of drivers rewarded with lower insurance rates.

According to a recent Progressive blog, Rate Suckers are the poor drivers forcing up insurance rates for good drivers. And Progressive’s SnapShot is intended to free drivers from the burden of supporting Rate Suckers.

(Link to Rate Suckers ad:

Progressive’s blog states: “Rate Suckers are real, and only Snapshot can stop them.

“You might not know it (63% of those we surveyed didn’t), but you’re paying more for car insurance because of others’ bad driving habits.

They’re called Rate Suckers, and they’re everywhere:
Behind the wheel for breakfast, lunch and dinner. 
Out to play at the strangest hours.
Slamming. On. Their. Brakes. Constantly.
Only Snapshot saves you! It sets you apart, so you can take back the savings you deserve.”

The message from Progressive could not be much clearer and clarity is useful in conveying the Snapshot UBI value proposition. But it is also possible that Progressive is over-simplifying.

The three driving behavior factors most frequently used as part of UBI programs generally are hard braking, harsh acceleration, the amount of driving and time of day. Progressive not only emphasizes hard braking in its blog but also in the functioning of the Snapshot module, which audibly and annoyingly beeps during hard braking.

Progressive’s model emphasizes the avoidance of hard braking and also focuses on taking a “snapshot” of a driver’s behavior – about a month’s worth of driving data – to establish A) whether the driver will benefit and, therefore, qualify for the program and B) the relevant discount.

Progressive is to be admired for its attempt at transparency and simplicity. The Rate Sucker advertising program is clearly intended to discourage drivers who drive a lot, drivers who drive between midnight and 4 a.m., and drivers that accelerate rapidly or brake hard.

Drivers may not agree with Progressive’s definition of the factors that determine safe driving or that lead to lower claims exposure, but at least the company is spelling out the objectives of the program. Drivers that fit the profile can self-select into the Snapshot program and those that do not ought not to even apply – unless they intend to change their driving behavior.

Interestingly, the Snapshot program’s safe driving criteria are antithetical to both the marketing and safety system strategies of car makers. Car makers routinely advertise the handling characteristics of their cars emphasizing both rapid acceleration and deceleration – both of which are shown in ads as the means to avoid hazardous circumstances rather than creating them.

Car makers also use advertising to demonstrate how safety systems can step in and assist drivers who may be distracted. Whether activating emergency braking in proximity to slowing or stopped vehicles or providing lane departure or blind spot warnings for inattentive drivers, the safety systems provide a more forgiving sensor cocoon in the car, with no penalty for the driver.

So all the things that car makers promote – acceleration, harsh braking or even frequent or late night driving - are likely to negatively impact a driver’s insurance rate, particularly if that driver uses Progressive’s Snapshot.  This raises the question as to whether Progressive’s criteria are too simplistic (ie. hard braking and harsh acceleration are not universally negative driving characteristics) or are OEMs promoting bad driving behavior either via their advertising or via the implementation of forgiving safety systems.

A driver who brakes harshly to avoid a collision with another driver that has made a driving error will want to be rewarded, not penalized. Similarly, a driver that accelerates to bypass a dangerous driving circumstance will also expect positive, not negative, feedback.

Progressive benefits from a simplistic message and a simplistic approach to UBI, but there is nothing simple about driving a car.  Progressive’s approach over-simplifies the proposition and ignores the fundamental nature of UBI in particular and telematics in general vis-à-vis auto insurance.

Progressive is adding thousands of Snapshot users every month, suggesting a respectable degree of success with the simplistic approach.  But the opportunity remains for competitors to deliver a more nuanced offering recognizing real-world driving behavior and leveraging, more broadly, the vehicle connection.

State Farm’s In-Drive offering, for example, delivers a broader functional portfolio including vehicle diagnostics, hazardous driving alerts, and a wider array of real-time vehicle and driving information. In fact, among the many UBI programs on the market Progressive stands out for the lack of added-value customer engagement.

Telematics has the ability to alter key aspects of the insured/insurer relationship around such issues as first notice of loss, timely claims processing and value-added services. If insurance telematics solely focuses on lower rates it is unlikely to have a lasting disruptive impact on the industry.


April 14, 2013 13:28 rlanctot

Usage-based insurance is a consumer deception. It is a shell game being foisted on consumers to lure them into allowing their car insurance company to glance over their shoulder as they drive and determine their insurance rate based on direct observation of their driving behavior.

UBI programs will no doubt be the focus of the upcoming Insurance Telematics Europe 2013 event in London May 7-8. The focus on UBI at this event is appropriate as the UK remains a source of critical leadership in bringing UBI to the mass market, something that has eluded all other geographies, including the U.S.

The failure of UBI programs to capture the imagination of the consumer lies in its deceptive quality.  The deception lies in the assumption that insurance companies know anything about what constitutes safe driving. But it is actually worse than that, because insurance companies are only allowed to use a limited set of data, depending on the regulatory jurisdiction, to draw their underwriting conclusions.

The attraction of usage-based insurance, or UBI, is that it is a potentially superior tool for determining rates than the existing models derived from driving history, credit scores, and demographic data.  UBI is also attractive to insurance companies trapped in a low growth increasingly low margin industry, because it allows them to draw away the lowest risk drivers from competitors while giving longer term customers a reason not to change.

Regulatory authorities and governments also like UBI programs because the participants tend to drive less, reducing congestion, carbon emissions and the potential for collisions and expensive claims. For young drivers or drivers with poor driving histories UBI programs, allowing remote tracking or monitoring, may be the only means of obtaining affordable insurance.

Strategy Analytics' own research has shown the highest level of interest in UBI programs among younger demographic segments in Europe and the U.S.  (Consumer Interest in Usage-based Insurance -

In Europe, where regulators have banned gender bias in car insurance underwriting, UBI may be an attractive work-around. And pay-as-you-drive programs based almost entirely on mileage, have also emerged for drivers who simply don’t drive much and, therefore, shouldn’t have to pay the same rates as those who drive more.

But the shortcomings of UBI programs are many and those shortcomings have limited the adoption of the technology to a few million users globally. At the core of consumer resistance is the surrender of privacy inherent in allowing the tracking of driving behavior. For the customer, UBI can be a crap-shoot – a 50-50 proposition that participation will actually produce a meaningful discount.

The offered discounts range from 5% just for the initial participation to as much as 40% based on the results of the tracking analysis. But some drivers will not qualify for any discount which can create a quandary in the event of a program using a tracking device that has been permanently installed (as opposed to an easily removed OBDII plug in), or in the case of a dealer or car OEM brokered offer that produces no discount. In the event of the former case the device may have to be uninstalled at a cost to the consumer, and in the latter case the customer may harbor bitterness toward the car maker or dealer.

But the basis for the discounting is specious. The most commonly cited factors are mileage, acceleration and hard braking. Some country and state regulators have banned the use of speed information for rating and we have already noted the restrictions on gender in Europe.

A recent conversation with a BMW executive had me questioning the entire UBI proposition. BMW will never participate in UBI offers, he said, because penalizing drivers for hard braking or acceleration is antithetical to BMW’s vaunted “ultimate driving” experience.  If BMW drivers participate in UBI programs and are, therefore, discouraged from hard braking or acceleration by their insurance companies, it undermines many of the pleasurable principals of driving a BMW in the first place.

But this is not just a BMW issue. An executive for a large multinational insurer recently questioned – in a personal conversation – the relevance of “hard braking” as an underwriting criterion.  Sometimes hard braking is a life-saving decision or an effective or appropriate reaction to an urgent or dangerous driving situation.

Many drivers have described to me the potentially harmful result of being forced to think twice or three times about accelerating or braking because of the presence of the tracking device on their car.  And I have yet to find a driver that is fond of the annoying beeping sound emitted by Progressive Insurance’s SnapShot device during what the device determines to be a hard-braking moment.

The Solution

My brother was visiting me recently and I told him about the tracking device I had installed in the OBDII port of my car for the purpose of qualifying for a lower insurance rate. His immediate response was: “Why don’t they just use your phone?” With those words my brother captured the very crux of the barrier between a potentially user friendly solution capable of empowering the customer and an annoying and invasive offering fraught with frustration and built to produce disappointment.

The most prevalent UBI offerings around the world require an OBDII plug in that attaches to the diagnostic port available on most, though not all, cars around the world. While the device and the port into which it is to be inserted are relatively simple to understand, the process is not user friendly.

Getting the device to the consumer generally requires the delivery of a product that has been programmed to work with the specific brand, model and year of vehicle to be insured. The hardware may be the same, but the software is not.

The process also assumes that the consumer will be able to locate the OBDII port, also a relatively simple exercise, but not very user friendly given the normal requirement of peering around under the driver’s side of the dashboard. OBDII ports were conceived to enable service technicians to attached diagnostic devices, not for insurance companies to track driving behavior and vehicle performance.

But that is just the hardware side of the proposition. Getting to the delivery and installation of the hardware device assumes that the consumer has accepted the proposition of sharing his or her data with the insurance company and, for that matter, any marketing partners with whom the insurance company may have hooked up.

Actual ownership of the data in most cases appears to lie with the insurance company. And the legal implications of that data ownership are less than clear in the event of an accident. As my disclosure statement states: “You release (the provider of the UBI device and service) and (the insurance company) from any liability associated with the disclosure of information gathered through (the UBI program).”

The problem at the core of the UBI value proposition is twofold: privacy and data portability and ownership. Many consumers have discovered that staying with a single insurer for too long – with a clean driving record and a related low rate – can make switching difficult. The new insurer won’t have access to the claims (or lack of claims) history that has produced such a low rate and will be, therefore, unlikely to match that rate.  This is different in the UK where claims history is centrally available. (Lesson #1 – you ought to switch your car insurance occasionally – or often? – to ensure you obtain the best rate.)

Carriers in the UK have been creating apps to enable consumers to get a preview of their potential UBI discount, but these apps do not solve the problem of complete consumer data ownership.  The very concept of consumer ownership of driving history data has yet to be seriously presented as a value proposition by either insurers or wireless carriers.  Perhaps with data ownership individual consumers could specify which driving attributes they care to share.

Data portability is the proposition that is actually being enabled by UBI programs but it is a concept that few insurers are embracing. In an ideal world, a customer that has gone to the trouble of installing a tracking device on his or her car ought to have ownership of the resulting data and the ability to take that data to another carrier for a competitive quote.

Here, the UK is taking the lead. Just as UK car insurers have led the way in UBI programs intended to defeat rampant fraud, and just as Norwich Union in the UK was one of the first insurance companies to use the Progressive approach to UBI insurance, an emerging insurance industry service provider in the UK, Ingenin, is poised to disrupt the entire insurance industry, not just car insurance.

Perhaps not surprisingly Ingenin’s plan revolves around leveraging the smartphone and all of its sensing capability for determining driving behavior along with a lot of other usage information that may be relevant for other forms of insurance as well. In fact, Ingenin’s proposition not only provides a platform for tracking driving behavior it enables the capture and delivery of information for roadside assistance or crash investigations.  And the Ingenin vision also calls for alerting drivers to known hazardous conditions or accident hotzones in real-time via the smartphone.

Even more significant, Ingenin is seeking to leverage voice and facial recognition to tie the insurance to a particular driver not just to the vehicle. Ingenin has yet to announce a major partner. In the meantime, the company is continuing work on bringing its vision to life.

In the end, it may take the use of the driver’s smartphone to deliver a personalized, empowering, and portable insurance proposition capable of transforming UBI insurance into a mass market phenomenon. Consumers are much more comfortable with and accepting of sharing their personal information via their phone – something they are consciously or unconsciously doing every day.

Nothing about current UBI programs is user friendly. In fact, everything from the hardware and software to the disclosure statements and privacy surrender are fairly hostile and opaque.  The use of smartphones as in the case of Ingenin can change all that.

March 31, 2013 22:30 rlanctot
At a time when governments around the world are raising gas taxes to discourage driving and fund the maintenance and expansion of transportation infrastructure, the state of Virginia (my home) and Maryland (right next door) are proposing to reduce or eliminate retail gas taxes.  The proposals are a part of elaborate funding schemes intended to resolve financial shortfalls associated with local transportation initiatives, but the blindingly obvious folly cannot pass without comment.
At the core of the debate which, in Virginia, will come to a vote April 3rd, is the apparent severing of the transportation funding source from the greatest users of the resource via the gasoline tax.  This separation is important because, almost unspoken as part of the refinancing plan, is the fact that the existing billion-dollar-plus funding shortfall is growing as cars become more fuel efficient, people (in some cases) drive less and hybrid and full-electric vehicles catch on with consumers.
The shift to more fuel efficient vehicles has failed to reduce congestion (or highway fatalities), which is why funding for public transportation is part of the funding equation.  This is another source of ongoing and unresolved controversy – the diversion of highway funds to public transport.  Some feel strongly that buses should be given priority for this funding, others believe that public-private partnerships are the answer.  (Rail-oriented solutions are exceptionally unpopular in some circles due to high costs and perceived inefficiency.)
While fuel taxes around the world have skyrocketed, transforming driving behavior, retail fuel taxes in the U.S. have remained low and fixed. (See attached table.)
Virginia: Virginia is proposing to eliminate the retail gas tax, add a 3.5% (emphasis mine) wholesale tax on motor fuel (backup plan of 5.1% tax in case of shortfall); increase the sales tax on non-food items to 5.3% from 5%; dedicate more general fund revenue to transportation; increases sales taxes to 6% in Northern Virginia and Hampton Roads with revenue to go to transportion; double the annual fee for alternative fuel vehicles to $100 from $50 – since amended to $64/year.  (There are also provisions for a reduced motor vehicle sales tax and a reduction in a hotel occupancy tax.)
Maryland: Maryland is proposing to reduce the retail tax of gas by 5 cents to 18.5 cents and then index it to the Consumer Price Index; impose a 2% wholesale tax on fuel to be increased to 4% in 2014 (backup plan of 6%); index transit fares to CPI.
Both Maryland and Virginia are seen as appealing to consumers by reducing the gas tax.  But the shift to a wholesale tax looks like simple sleight of hand.  The strategy also goes against the findings of the Metropolitan Washington Council of Governments’ Transportation Planning Board study on the “Public Acceptability of Congestion Pricing” which found participants most accepting of maintaining or increasing gas taxes.
The TPB study gathered consumers and brainstormed around three potentially congestion-reducing scenarios:
1.      Priced lanes on all major highways
2.      Pricing on all streets and roads – ie. a road use tax based on GPS readings
3.      Priced zones – likely enforced with license plate readers
The study found the most support for priced lanes on all major highways and the least support for a road use tax enforced by an on-board device. (See attached table.)
The results are interesting because a rod use tax is the most often suggested alternative to the gas tax.  Some high profile tests have been conducted in The Netherlands and in the state of Oregon in the U.S.  Taxing road use directly is seen as an ideal funding mechanism since it accounts for alternative fuel vehicles that let their owners avoid the gas tax.
In fact, the state of Virginia clearly has alternative fuel vehicles in mind when it is proposing increasing the annual fee for electric cars.  Here, too, the Virginia approach is counterproductive and counter intuitive since it discourages the use of vehicles that are meant to reduce both harmful emissions and dependence on foreign oil.
The TPB study further uncovered the fact that consumers – after participating in the TPB forum - were not so opposed to gas tax increases. (See attached table.)
Participants in the TPB forum also opposed the perceived tradeoff between road use taxes and lower gas taxes. (See attached table.)
The rejection of the road use tax appeared directly tied to the required hardware – a GPS added to a vehicle.  The objections expressed included focused on concerns about privacy, complications and impracticality.
These findings have significant implications for the UBI development efforts in the insurance industry.  Insurers also want to mount devices on vehicles – usually using the OBDII diagnostic port, although sometimes via other means.
The Federal government is funding UBI program trials in the hopes of leveraging these programs for their ability to reduce the amount of driving overall and, thereby, emissions and congestion.  But overcoming the objections to privacy concerns and the complexity of device installation may be being underestimated.
Still, Strategy Analytics’ own survey of consumers in Europe and North America found a significant level of interest in the programs – even though participation rates remain low. (See attached table.)
Having visited Dallas last week I can say that it appears that the North Dallas Tollway Authority has figured this issue out in favor of Scenario 1 from the TPB study.  Most major roads in and around the area have an array of tolls intended to manage traffic using a combination of toll-tags and license plate scanners – and no tracking devices.
Transportation authorities are facing multiple challenges including:
1.    Reducing congestion
2.    Reducing emissions
3.    Increasing revenue for maintenance, infrastructure and public transportation
Gas taxes have been the preferred funding option around the world because it is a direct tax on the consumers of the resource.  The emergence of alternative fuel vehicles poses a significant challenge to future funding models.
While politicians may debate the merits of financing public transportation projects with funds derived from the use of highways, the rationale that public transportation increases the overall capacity of the network is reasonable.  It is also understandable that states may wish to charge a user fee for alternative fuel vehicles, as Virginia currently does, but this runs counter to the objective of encouraging the use of these vehicles (subsidized by Federal and/or state tax deductions, etc.).
The TPB findings that consumers are receptive to higher gas taxes and tolling point the way to an equitable resolution of the funding challenge facing the U.S.  And concerns regarding privacy are likely to create barriers to the wider acceptance of both road charging and UBI insurance. 

March 28, 2013 10:11 rlanctot

Telematics systems can do a lot of things these days, but one thing they cannot do is see to it that family members of unconscious crash victims are contacted in a timely manner after a crash.  Car makers are fond of touting Twitter and Facebook integrations in the car, but nearly two decades of work have failed to solve the problem of next of kin notification.

Good news is arriving from the West Coast of the United States.  Legislation has been introduced in the California legislature by Senator Curren Price and Assemblyman Steve Fox to ensure law enforcement personnel can notify next of kin quickly in the event of a traffic incident in which victims are incapacitated.  Action is expected in April.

It is wise for consumers, auto makers, emergency responders and law enforcement representatives in the U.S. and around the world to take heed.  Given the influence of past legislation in California on automotive-related issues such as vehicle emissions, it may well be that California finally resolves for the global auto industry an issue that has plagued crash responders for decades – crash victim identification and notification of next of kin.

The California Motor Vehicle Emergency Contact Locator Act of 2013 (AB 397) solves this problem.  Its passage will create the nation’s first VIN Emergency Contact Locator (VIN ECON) database which will be accessible to authorized law enforcement agencies nationwide.  Such a database will serve as a model to be emulated around the world.

The legislation arrives at a time in the automotive telematics marketplace when car makers have all but moved on from the focus on safety and automatic crash notification that gave rise to embedded vehicle connections in the first place.  Car makers today are distracted with smartphone app integrations and vehicle relationship management.  The life-saving capabilities of telematics systems have been all but forgotten or at least taken for granted.

Each telematics service provider collects emergency contact information linked to the VIN at customer provisioning.  They store the emergency contact information in a database silo which is only accessible by the TSP. 

The TSP safety innovation of the California legislation is that it established a centralized emergency contact information database (VIN ECON) at a national law enforcement  telecommunication center that will aggregate and link the silo-ed databases so that law enforcement representatives will have immediate access to the data.  In fact, the database will backstop the telematics system in case the system fails to contact the TSP.

Some in the industry assume that once the embedded modem is connected to a call center, the well-being of crash victims is assured.  And there are touching stories of OnStar call center representatives contacting family members and connecting them with crash victims at the scene of the event. 

But these stories obscure the reality of an unconscious crash victim at the scene of the crash unable to communicate his or her identity or desires at the scene of the collision.  Valuable time and, sometimes, lives are lost as a result.  Without a nationwide database to aid responders, there is little that can be done to reach out for help and certainly not in a timely manner.

The idea for AB 397 was originated by L.A. Councilmember Dennis Zine in response to a 2007 car crash in the San Fernando Valley involving the death of a 72-year-old mother from Paso Robles.  The bill is co-sponsored by the City of Los Angeles and the non-profit organization We Save Lives, founded by Candace Lightner (also the founder of MADD).

Additional support for the creation of the database has come in writing from such organizations as the Association of Public-Safety Communications Officials-International (APCO), the International Association of Chiefs of Police (IACP), the International Association of Fire Chiefs (IAFC), the Governors Highway Safety Association (GHSA), the National Association of State EMS Officials (NASEMSO), and the National eHealth Collaborative (NeHC), which specifically supports AB 397.

Instead of taking hours, or even days, the bill will ensure the swift notification of family members who can then better assist law enforcement officials in identifying incapacitated crash victims and aid health care representatives in the care of their loved ones.  “This is a targeted, common sense approach to an important public safety issue,” in the words of Lightner.  “It is unacceptable for families and crash victims to suffer because of lack of adequate or seriously delayed notification.  We must ensure that law enforcement officials have the resource necessary to quickly access a motor vehicle owner’s emergency contact information that will help save lives and alert family members in the event of a tragic crash.”

Lightner’s sentiments echo those of GM’s former vice chairman, Harry Pearce,  at the conception of Project Beacon, which went on to become OnStar.  He asked, at the time, how many crashes would have to occur with no timely emergency response before GM would recognize the obligation it had to provide for automotic crash notification. 

It was only later that OnStar stumbled on the challenge of identifying crash victims and the need to notify next of kin.  OnStar executives quickly discovered they had a real problem on their hands in the event of unresponsive crash victims – a problem that the OnStar service could not solve.

Telematics service providers generally gather motor vehicle owner emergency contact information at the dealership during the service registration process, but there is no means for sharing the information with law enforcement without the customer’s consent – which can’t be given if the customer is unconscious.  More importantly, the information is not stored in a centralized law enforcement-accessible database.

In a similar vein, eight states in the U.S. have next of kin databases based on driver’s license information, but each of these databases is silo-ed and not nationally accessible.  Furthermore, these driver's license systems require law enforcement officers to physically locate the driver's license at the scene of a crash, which is typically not possible in the most horrific of crashes.

In the words of one of the bill’s sponsors, Steve Fox: “The Motor Vehicle Emergency Contact Locator Act is important to drivers and emergency medical care providers.  The fact that this law can assist doctors by allowing them to have timely access to family members and to obtain additional information such as the victim’s medical records and medical directives will save lives.”

Fellow sponsor Curren Price added:  “The agony of not knowing if a missing relative is injured or alive or dead cannot be overstated.  This bill will go a long way to addressing the heart-wrenching issue.”

Research has produced advances in telematics such as enhanced automatic crash notification – capable of alerting first responders to the severity and nature of a crash to determine the appropriate emergency response.  But responders face a real challenge in identifying victims who have been incapacitated.

The simple process of creating a centralized VIN ECON next of kin database capable of closing this loophole will save lives and give family members much-needed peace of mind.  Equally important, it will save time and effort on the part of emergency responders, which in itself may save lives.

The best news of all is the fact that the database will be created and maintained by public authorities.  There is no burden on the automotive industry or automotive dealers, since dealers are already gathering the information.  The gathering of next of kin notification information will, now, no longer be a pointless activity.  With passage of the bill and creation of the database the consumer – and the dealer and the auto maker and emergency responders – can rest assured that law enforcement personnel on the scene of a crash will be able to more quickly determine the identities of drivers and passengers and notify relatives.

In the end, the VIN ECON is really a low-tech, low-cost solution to an urgent challenge.  It requires no hardware or software to be created by car makers or dealers, it simply ties together existing information resources and makes that information accessible to the appropriate persons under specific and restricted circumstances.

March 17, 2013 12:50 rlanctot

Returning to Brazil for the first time in a few months I was struck at the paucity of technology in the taxi cabs. Having recently been at the Consumer Electronics Show in Las Vegas I was accustomed to everything from smartphones and GPS devices to cameras, sensors, backseat advertising displays, and payment terminals in cabs. Suddenly, in the land of the vehicle immobilization mandate (Contran 245) I was confronted cab after cab with nothing but a dispatcher and fare machine.

That is, until yesterday in my cab ride from Garulhos Airport in Sao Paulo.  According to the driver, the taxi that took me and my wife to our hotel was part of a 500-cab trial of a backseat tourist aid that was a real revelation and nothing I had seen anywhere before.

Put together by a local company, Comtecno, for the Brazilian Ministry of Tourism (and also available in Recife, where the World Cup with be contested), the device was a Samsung tablet computer equipped with cellular connectivity.  Comtecno calls the device the Multitoky Mobile and the company has as its goal deployment at 14 Brazilian airports for a total of 12,000 devices.

The tablet was unobtrusively strapped to the back of the cab driver’s seat, and I wouldn’t have noticed except for the fact that I am on the constant lookout for in-car tech.  The device charges while in the pouch and its use requires no assistance from the driver.

I immediately grabbed the device, figured how to open the browser and accessed a couple of email accounts.  Before long my wife and I were checking out local tourist attractions and restaurants and peppering the driver with questions.

“Do people like it?”


“Do you ever use it yourself?”


“How do passengers use it?”

“To help tell me their destination.”

“Do customers have any complaints?”

“The connection is slow.”

“Will it play video and audio?”


With only 500 cabs as part of the test it was not surprising that the only overt advertising on the device appeared to be public service announcements warning tourists against sex tourism and people trafficking.  Coming in to Sao Paulo one could imagine a few more pointed warnings, but overall the device was a true joy to discover in the rear seat of our cab and a promise of future innovations to come.

Given the relatively high crime rate and the country’s position as have the third highest number of highway fatalities, one could argue for the implementation of cameras for anti-theft and fraud, along with sensors for maintaining vehicle distance in traffic.  But, generally speaking, the cab drivers are some of the best drivers in Brazil.  (A good contrast is China where there is little respect for lanes, let alone other vehicles.)

But if a Samsung tablet in the rear seat – tethered by a security link – is a first step on the path to vehicle connectivity in Brazilian taxi cabs, it is highly welcome.  It is far superior to the annoying embedded backseat advertising displays found in Las Vegas, New York City and Shanghai, among other cities. 

The rotating messages on these backseat screens are entirely without any merit as far as helping to educate either visitors or locals regarding popular local businesses or for providing informational traveler alerts.  Anyone who attended CES in Las Vegas is likely sick and tired of hearing Steve Wynn tout his gambling properties – a fact reflected in the reflexive tendency of most cab drivers to try to at least turn off the volume on the device even if they could not stop the video.

Kudos to Comtecno and the Brazilian Ministry of Tourism and the for conceiving a creative solution for connecting with tourists.  The next step will be to enable all types of transactions, including perhaps paying cab fares.  Of course, Brazilian cab drivers are still talking on their mobile phones too much and, occasionally, watching video both while parked and driving.  Oh, well, they can’t get everything right all at once.

March 9, 2013 21:58 rlanctot

I have frequently expressed skepticism regarding the mass market potential of usage-based insurance and nothing about my experience with State Farm's DriveSafeandSave program has changed that viewpoint.  At a gut level, consumers tend to resist surrendering their privacy to participate in such a program.  Of course, younger demographic segments, including those surveyed by Strategy Analytics, have shown a unique willingness to surrender that privacy in exchange for economic value – ie. an auto insurance discount.

There is no question that there are pockets of consumer interest in UBI insurance especially where auto insurance rates are either universally high due to prevailing market conditions or prohibitively expensive for particular drivers.  To the extent that competitive forces fail to suppress insurance rates, UBI programs can become the only route to finding a lower premium.

This brings me to the more fundamental obstacle to widespread acceptance of UBI insurance: trust.  One of the advantages of UBI insurance that is frequently touted by analysts is its ability to change the customer relationship by increasingly the frequency of customer interactions and enabling a higher degree of transparency around the determination of the customer’s insurance rate.

The problem is that few insurance companies are set up to take advantage of this new customer service paradigm.  The industry is built around infrequent customer contact in order to minimize the unpleasantness of policy renewal or the filing of a claim.  This fact was brought home to me recently when I explored a UBI offer from my own insurance company, State Farm.

State Farm has more than 20,000 independent agents selling insurance nationwide.  Normally this is considered a huge market advantage, which is reflected in the fact that State Farm is one of the largest, if not the largest, auto insurer in the U.S.

My agent sent me a letter offering a 5% discount if I were to sign up for the company’s DriveSafeandSave program.  DriveSafeandSave is approximately two years old, but as with most such programs it has taken time for State Farm to secure state-by-state regulatory approval for the program.

DriveSafeandSave was made possible in large part by a cooperation with Hughes Telematics which supplied its In-Drive module – an OBDII plug-in – to enable the program.  But DriveSafeandSave also allows drives of Sync-equipped Ford’s or OnStar-equipped GM vehicles to participate via those devices.

The beauty of taking advantage of the offer being made to me by State Farm is the fact that State Farm already knows my driving history and the driving history of my entire family, all of whom are insured by the company.  This means, State Farm can offer me the 5% discount immediately without any need to conduct any credit or driving history check requiring the onerous process of filling out forms and answering probing questions.

I know about the potential complexity of pursuing the second route – evaluating alternative carriers – because I did submit information for quotes but quickly realized that get a precisely equivalent offer I not only had to include my homeowner’s coverage but would also have to spend a lot more time digging into the details of the different offers – which, by the way, have been pouring in.

So I contacted State Farm to ask about the DriveSafeandSave program and, for the first time ever, spoke directly to my agent.  For as long as I can remember I have only interacted with one of his assistants.

Surprisingly, my agent pleaded ignorance of the DriveSafeandSave offer in spite of the fact that the letter I had received in the mail had his signature on it.  At this point my agent told me that I must be talking about the box that was sitting on his desk.  Evidently an In-Drive device had been sent to him to perhaps use on his own car.

I immediately explained to him how UBI insurance worked generally along with what I knew of the DriveSafeandSave program.  He was genuinely interested and promised to follow-up.

By now you may be beginning to understand what I am talking about regarding a new customer service paradigm.  Insurance companies are essentially getting into the consumer electronics business, with all of the customer service and support implications that that implies.

Consumers will need help installing the device, understanding how it works, understanding their privacy rights and understanding the scope of the insurance company’s right to use their personal information.  In that regard, I received a phone call a couple days later from my agent’s assistant who wanted me to sit through a reading of the program’s user agreement and privacy statement and agree to all of its terms.

Thankfully, the assistant agreed to email the document to me after I had agreed to all of its clauses (see below).  Based on my indicated wishes, I should have, by now, received at least three In-Drive devices to affix to my cars – but more than two weeks have passed and I am still waiting.

The issues at stake in this new customer relationship are, therefore, not limited to trust.  Another key issue is expectations.  I am expecting to see devices show up at my home to be installed on my cars by me, after which I will be able to access the driving information of all of the correlated vehicles online.

I am still waiting and the longer I wait the more my trust is being undermined and my expectations unmet.  I am also waiting to see a clear statement reflecting the 5% discount in my aggregate premium.

There is no doubt that UBI insurance has the potential to alter the course of the insurance industry providing a tool to enable more accurate underwriting.  But as long as carriers remain mired in old customer relationship patterns they are not likely to reap the full rewards of UBI offers and the program will remain a niche offering for desperate customers like me seeking to insure young drivers.

The good news for my agent is that he has by now received from me several reports and blogs written on this subject and so, better than most State Farm agents, he now knows what this new program represents – ie. a chance to reach out and snatch customers from competing carriers.  With any luck he has installed the In-Drive module on his own car so that he can better understand and explain the technology and the service to his new and old customers alike.

User Agreement:    

(From the email message: "You have requested to enroll in the Drive Safe & Save with In-Drive program.   I must get your consent to the following: ")                                    

- You have the full right and authority to provide consent on behalf of all   

Named Insureds on the policy and the owner(s) or lessee(s) of the vehicle.  

- You understand and agree that Drive Safe & Save will impact the premium for 

the vehicle and any renewal, transfer, reinstatement, amended, substitute or

replacement vehicle unless a new consent is required by State Farm or until 

participation in the program is discontinued.                               

- You understand that if you are currently receiving a premium reduction for  

low estimated annual mileage as reflected on your policy renewal notice or  

declarations page, your premium may increase at a future renewal if the     

calculated annual mileage no longer fits those criteria.                    

- You understand your Drive Safe & Save discount amount may be adjusted at    

each renewal based on the collected driving information.                    

- You are or intend to be a Hughes Telematics, Inc. (HTI) In-Drive subscriber 

by installing the In-Drive device into the enrolled vehicle. You understand 

that if you do not install the device within 30 days, you will not be       

eligible for Drive Safe & Save.                                             

- You authorize HTI to provide State Farm with mileage and other vehicle usage

information, such as how, when, and most common areas (approximately 40     

square miles) the vehicle is driven.                                        

- You understand that the device you receive from HTI as an In-Drive          

subscriber must remain installed in the participating vehicle for you to    

remain eligible for the program.                                            

- You understand that you may not be eligible for the program if you cause    

State Farm to receive inaccurate data for the participating vehicle.        

- You understand the insurance premium as it relates to annual mileage will 

be based on vehicle miles driven as reported by HTI instead of estimated    

annual mileage. Also, you understand that other vehicle usage information 

obtained from HTI can impact your premium.   

- You authorize HTI to verify the status of your In-Drive enrollment and to   

provide information from the vehicle to State Farm.                         

- You authorize State Farm to share your contact and other policy information 

with HTI to facilitate your participation in Drive Safe & Save.             

- You release HTI and State Farm from any liability associated with the       

disclosure of information gathered through Drive Safe & Save and In-Drive.  

- You understand that any Named Insured can discontinue participation in the  

State Farm Drive Safe & Save at any time by notifying your State Farm agent.

- You will inform your State Farm agent if you are no longer an HTI           


- You will inform HTI and your State Farm agent if the vehicle is sold or     

transferred to a new owner or lessee. You will remove and return the In-Drive

device before the vehicle is transferred.                                   

Do you consent and wish to enroll in Drive Safe & Save?          Y       

Does the customer need a telematics device?      Y        (Y/N)